California Officials Seek Lower Prices for AIDS Drugs

From CDC National Prevention Information Network

April 12, 2011

Treasurer Bill Lockyer on Friday became the second California official to ask for an extension of price cuts and rebates granted by some drugmakers last year to help the state's AIDS Drug Assistance Program (ADAP).

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In a letter to eight pharmaceutical firms, including Bristol-Meyers Squibb (BMS) and Merck & Co., Lockyer thanked the drugmakers for working with the state but said he remains concerned about the profits they have made from price increases in recent years. California's ADAP, which serves 38,000 low-income patients, has seen a 257 percent increase in drug costs since 2000 -- triple the rate of patient growth in the program during that same time period. "California cannot afford to increase the budget for ADAP indefinitely in order to pay for higher drug prices," Lockyer wrote.

Last week, Controller John Chiang sent a similar letter to Gilead Sciences. Both Chiang and Lockyer sit on the board of the state's two key public pension funds, which hold considerable shares in the targeted drugmakers.

Drugmakers agreed to price reductions and rebates last year to help the state's budget shortfall; California currently is facing a $15.4 billion deficit. Last year, officials cut $25.5 million from ADAP, leaving the program with $70.8 million in state funding. Gov. Jerry Brown has proposed trimming $16.8 million from ADAP for the new fiscal year that begins in July.

BMS spokesperson Cristi L. Barnett said the company is "committed to helping ensure that people living with HIV and AIDS have access to our medicines" and open to dialogue about its multiple access programs.

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